Australia property prices continue to fall

Wednesday, June 1, 2011

Capital city property prices in Australia continued to fall in April as high interest rates and floods early in the year in Queensland continue to have a negative impact on demand, with the top end of the market the poorest performer, according to the latest RP Data-Rismark Hedonic Home Value Index.

The report reveals that prices fell 0.3 per cent in April from March. It fell 1.2 per cent in the three months to the end of April.

Tim Lawless, RP Data's research director, said that the markets had slowed in some capital cities illustrated by rising mortgage arrears.

“The solid performance of cheap suburbs runs against the grain of popular claims that default rates are rocketing up amongst first-time buyers, which the RBA recently rejected,” Mr Lawless said.

Property prices are falling across much of Australia, following strong capital gains in recent years, with the sharpest falls being recorded at the high end of the market, particularly in the expensive suburbs. This is likely to create fresh negotiating opportunities for anyone seeking to buy a home in Australia.

Chris Joye, Rismark's joint managing director, told the press: “The uber-luxury segment is risky and highly illiquid and has had the rug whipped from under it via a combination of the soaring Aussie dollar and the volatile share market.”